PETALING JAYA: Sustainable energy solutions provider Kinergy Advancement Bhd
is expected to deliver record earnings for the financial year ending Dec 31, 2026 (FY26) as major projects enter their key execution phase, says Hong Leong Investment Bank (HLIB) Research.
The research house – which did not rate the stock, but gave it a fair value of 53 sen – said the company’s major engineering, procurement, construction and commissioning (EPCC) projects have entered into the peak execution phase, marking an earnings inflection point.
HLIB Research noted that favourable foreign-exchange movements and the expected completion of the Sipitang Oil & Gas Industrial Park project should provide additional support to margins.
It projects core net profit to grow 39% in FY26, 26% in FY27 and 7% in FY28.
This translates into a three-year compounded average growth rate of 23.2%, with sustainable growth to be supported by continued project execution and increasing contributions from recurring income streams.
“Kinergy has successfully leveraged its proprietary waste heat recovery technology to establish a strategic relationship with Petroliam Nasional Bhd (PETRONAS). To date, the company has secured three major EPCC contracts from PETRONAS, demonstrating its capability to execute increasingly complex utility-scale energy projects.
“We believe this proven execution track record enhances Kinergy’s competitive positioning and increases its likelihood of securing repeat contracts as PETRONAS continues investing in gas-fired power and lower- carbon infrastructure,” it added.
HLIB Research believes that beyond gas-fired power, the company “is well positioned to benefit from Malaysia’s long-term renewable energy (RE) expansion, underpinned by the government’s target to achieve a 70% RE capacity mix by 2050”.
Kinergy has established a sizeable 1.8-gigawatt RE pipeline in Perak through a partnership with the Perak State Development Corp.
“We believe the pipeline provides strong visibility for future EPCC contracts, concession assets and recurring income growth.”
At a valuation of 53 sen, the implied price-to-earnings stood at 26.5 times for 2026 and 21.2 times for 2027.
